Arthur Hayes, co-founder of the BitMEX exchange, believes that the fall in the exchange rate of gold and bitcoin will make the Tether (USDT) stablecoin bankrupt.
Hayes commented on the report on assets held on the balance sheet of the USDT issuer Tether, and concluded that the firm is increasing its reserves of XAU and BTC in response to the likely reduction in the key interest rate in the United States. If this happens, bitcoin and many other cryptocurrencies will rise in price due to the decrease in the value of money. However, investments in precious metals and digital assets are not without risks.
A drop in the price of gold and bitcoin by about 30% will deprive Tether of a large share of capital, and theoretically USDT could go bankrupt. I am sure that owners of a large number of stablecoins and exchanges will require Tether to publish real—time balance reports," Hayes wrote.
Judging by Tether's report on assets supporting the stability of the USDT exchange rate, the company owns precious metals and bitcoins worth $22.8 billion, which is only 12.6% of the value of assets on the balance sheet of the institution. 77% of the company's reserves are accounted for by bonds, monetary funds, fiat currency and repo agreements, so Arthur exaggerates.
However, due to a 30% drop in the exchange rate of BTC and XAU, while maintaining the current value of the remaining assets, 3.7% of USDT in circulation will indeed be unsecured.